Knowing Your Goals in Choosing the Right Property to Buy
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Abdullahi Waziri
By Abdullahi Waziri
Published on 05/17/2009
Once you cover these bases, the next step is to take a swing. Many an investor has been waylaid by the inability to make a decision. If you want make money in real estate, you will eventually have to make an offer. There is no way of getting around it. So do your research, make your plan, reduce your risk through knowledge and foresight, take a deep breath and dive in. The first offer is always the hardest. With each subsequent offer your fear should decrease as your knowledge increases, but you still have to take this first step.
Knowing Your Goals in Choosing the Right Property to Buy
It is absolutely important for any type of investor to look thoroughly at his intended channel of investment. Not just looking at the profitability side of the business but also factors responsible for both failure and success. Real estate investment is a type of business that requires constant research and discussion to understand the new trends available in the business. Take your time before investing your money in any property for acquisition. Consider the following factors also before diving in.
Knowledge of Yourself: Knowledge of your abilities is an important factor but it is often overlooked. Do you know yourself? D you know the level of stress with which you will be comfortable? Do you prefer working with families or businesses? Do you like working 12 hours long? Are you comfortable seeking entrepreneurial help for your investment or are you more of a go-it-alone sort of person? The answers to these questions and others can help you determine where to put your real estate investment energies. Again, don't just look for the lowest price. Go into investment business with your eyes open. Have a plan.
Planning: A good plan takes into account worst case scenarios, best case scenarios and coping mechanisms. It must at once encompass the passion that lasts for the long haul and the flexibility that allows for change. It means knowing yourself, knowing your finances and knowing your market.
Know Your Finances: make a spreadsheet of your bills, your income and your discretionary income. How much can you realistically afford for a down payment? How much can you realistically afford for mortgage payments. What cushion do you have in the event of vacancies?
You must also know what you want before you go looking for properties to buy. If you want to rent single-family units to families, don't buy a bargain-basement home with no yard in a gang-infested neighborhood. If you want manage a high-end office unit for professionals, don't buy an obsolete concrete building in the industrial section outside town.
It is important to think through all your goals before you even view a property. You want to be sure that emotions don't enter in to your choice. You might be tempted by a paint job or a low price or even a property that reminds you of happy times in your life. Leave your personal preferences, biases, greed and nostalgia at the door. This is business.
Knowledge of Yourself: Knowledge of your abilities is an important factor but it is often overlooked. Do you know yourself? D you know the level of stress with which you will be comfortable? Do you prefer working with families or businesses? Do you like working 12 hours long? Are you comfortable seeking entrepreneurial help for your investment or are you more of a go-it-alone sort of person? The answers to these questions and others can help you determine where to put your real estate investment energies. Again, don't just look for the lowest price. Go into investment business with your eyes open. Have a plan.
Planning: A good plan takes into account worst case scenarios, best case scenarios and coping mechanisms. It must at once encompass the passion that lasts for the long haul and the flexibility that allows for change. It means knowing yourself, knowing your finances and knowing your market.
Know Your Finances: make a spreadsheet of your bills, your income and your discretionary income. How much can you realistically afford for a down payment? How much can you realistically afford for mortgage payments. What cushion do you have in the event of vacancies?
You must also know what you want before you go looking for properties to buy. If you want to rent single-family units to families, don't buy a bargain-basement home with no yard in a gang-infested neighborhood. If you want manage a high-end office unit for professionals, don't buy an obsolete concrete building in the industrial section outside town.
It is important to think through all your goals before you even view a property. You want to be sure that emotions don't enter in to your choice. You might be tempted by a paint job or a low price or even a property that reminds you of happy times in your life. Leave your personal preferences, biases, greed and nostalgia at the door. This is business.